MN Chamber Sues Minneapolis Over Sick Time Rules

October 26, 2016

The state’s largest business association, the Minnesota Chamber of Commerce, is taking the city of Minneapolis to court over its new sick time ordinance — on the basis that it is preempted by state law.

The organization wants a district court judge to halt implementation of the city’s ordinance, slated for July 2017. Their suit argues that the new rules pose major regulatory challenges for employers in an environment when employees often work across municipal boundaries.

The city’s ordinance, passed in May, requires employers to provide an hour of sick time for every 30 hours an employee works — though the mandate is capped at 48 hours of sick time per year.

“In today’s global market, it is not possible to regulate employment terms within private employer-employee relationships and limit those regulations to the city of Minneapolis,” the lawsuit says. “Employment regulations inherently permeate those boundaries and result in a ripple effect — if not a tidal wave — throughout Minnesota and beyond.”

As an example, the lawsuit points to Graco, Inc., which has employees who transfer between divisions in and outside of Minneapolis. The rules apply just to employees who work 80 hours a year in the city, but “Graco’s systems are not equipped to track which city the employees are in on an hour-by-hour basis.”

“Minnesota law prohibits cities from enacting ordinances that conflict with state law – but that’s exactly what Minneapolis has done,” said Chamber President Doug Loon in a statement. “Regardless of how well intentioned the Minneapolis ordinance is, it’s unworkable and unlawful so we’ve asked the court to strike it down.”

Loon called the sick leave ordinance a “one-size-fits-all” mandate.

City Attorney Susan Segal said she was confident the city could defend the legal challenge.

“The City’s new landmark Safe and Sick Time Ordinance is a critical step toward protecting the health, safety and general welfare of Minneapolis residents, workers and visitors,” Segal said.

St. Paul has also passed a similar sick time ordinance, which would take effect at the same time. The lawsuit argued that this other ordinance has already created a patchwork of regulations.

“In a particularly absurd example, the corporate headquarters of Hubbard Broadcasting, Inc., a member of the Minnesota Chamber, straddles the border of St. Paul and Minneapolis, making the company subject to two similar, but different ordinances — at the same time for the very same employees.”

Minneapolis is also study potentially enacting a citywide minimum wage of $12 or $15 an hour. The lawsuit does not address that issue, but the chamber said in a statement that its position is that “state law preempts municipal regulation of wages and benefits.”

The announcement came as business leaders were meeting with city leaders at City Hall on Friday morning, as part of an event hosted by the Minneapolis Regional Chamber of Commerce.